The IRS Has Deeply Disturbing Problems
Essex & Associates www.Essexinc.biz January 31, 2012
National Taxpayer Advocate Nina E. Olson on January 10, 2012 released her annual report to Congress, identifying the combination of the IRS's expanding workload and declining resources as the most serious problem facing taxpayers.
The result, the report says, is inadequate taxpayer service, erosion of taxpayer rights, and reduced tax compliance.
She noted: There were approximately 4,430 changes to the tax code from 2001 through 2010, an average of more than one a day, including an estimated 579 changes in 2010 alone.
In 2010 alone, the IRS made about 15 million contacts with individual taxpayers to adjust their tax liability, which is one in every nine taxpayers.
In 2010, the IRS issued notices correcting 10.6 million "math errors," up from four million in 2005.
These notices are tax assessments that presumably result from mathematical or clerical errors. Unless a taxpayer disputes the IRS assessment within a limited timeframe, it may not be appealed to the Tax Court.
From FY 2004 to FY 2011, the percentage of calls that the IRS answered from taxpayers seeking to speak with a telephone assistor dropped from 87 percent to 70 percent.
Over the same period, the IRS's ability to timely process taxpayer correspondence also declined.
Comparing the final week of FY 2004 with the final week of FY 2011, the backlog of correspondence in the tax adjustments inventory jumped by 158 percent (from 357,151 to 920,768).
"The decline in these key measures is deeply disturbing," the report says.
Telephone calls and correspondence are the two main ways taxpayers communicate with the IRS.
Few government agencies or businesses would be satisfied if their customer service departments were unable to answer three out of every ten calls, nor would they be content when nearly half of all correspondence takes more than 6½ weeks to answer."
Bottom line is the IRS is overwhelmed by all the tax law changes (who isn't) and they will contact 15 million of us this year but yet not answer the phone 30% of the time when we try to contact them back.
When we finally do get a hold of them it will take them approximately 45 days to give us an answer.
Ms. Olson says, "We need a major overhaul to the IRS" and I couldn't agree more.
Wishing you many happy returns,
Wayne T. Essex Ph.D.
Essex & Associates
Tax, Accounting, Payroll
7501 Paragon Road
Dayton, Ohio 45459
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